Bitcoin (BTC) price traded as low as $91,231 on Binance on Monday Morning, as crypto markets buckle under pressure from escalating trade tariff war involving the United States.

Bitcoin (BTC) Plummets to $91K as Crypto Market Liquidations Hit $1.8 Billion

Bitcoin (BTC) plunged below the $91,200 mark on February 3, its lowest level in 20 days. This decline follows mounting economic concerns sparked by former U.S. President Donald Trump’s aggressive trade tariffs on China, Mexico, and Canada, which have triggered widespread financial market turbulence.

As fears of rising consumer prices escalate, social media reports suggest that American consumers are preparing for inflation by stockpiling essential goods. This has led to a shift in retail investor sentiment, with many liquidating riskier assets such as stocks and cryptocurrencies in favor of more stable stores of value.

As depicted above, Crypto market liquidations have exceeded $1.8 billion as BTC price plunged 7% in the last 24 hours, signaling unusually heavy capitulation from large investors.

This suggests that Bitcoin institutional investors are also responding to inflation risks, anticipating that the U.S. Federal Reserve may be forced to raise interest rates sooner than expected.

This has led many to shift capital toward government bonds before interest rate hikes push prices higher. Combined, these factors have exacerbated selling pressure in the crypto market, driving Bitcoin’s price down by 11% over the past three days.

Key Bitcoin (BTC) Price Levels to Watch 

Amid the ongoing crypto market downturn, some crucial BTC trading signals indicate key levels that could be pivotal to Bitcoin price action  as the week progresses.

Coinglass Liquidation Map Shows BTC’s Strongest Support Level Lies at $90,360

Bitcoin started the week under pressure due to the bearish sentiment surrounding the escalating trade war. Many U.S.-based traders likely set sell orders over the weekend, anticipating further downward movement as markets opened on Monday. This could result in heightened volatility in the early trading hours.

Coinglass’ liquidation map provides insight into the critical price levels where traders have placed leveraged positions. The chart displays Bitcoin’s aggregated leverage positions over the last 30 days, revealing key areas where liquidation events are likely.

The data suggests that bearish sentiment dominates, with $11.9 billion in short positions far exceeding the $3.04 billion in long positions. This confirms expectations of further downside risk.

However, bullish traders have concentrated $2.12 billion in leverage at the $90,358 level, accounting for 70% of total long leverage positions. This indicates strong potential support around $90,500, as traders seek to defend their positions from liquidation losses.

Other key support zones include $93,000 and $94,330, where long positions total $1 billion and $330 million, respectively. If Bitcoin’s price approaches these levels, we could see increased buying activity aimed at stabilizing the market.

Nevertheless, a prolonged bearish trend could persist unless global economic conditions improve or influential market participants intervene to stabilize sentiment.

The Double-Bottom Pattern Signals a Potential Breakout Toward $108,000

While the prevailing market sentiment remains bearish due to macroeconomic pressures, certain technical indicators suggest the possibility of a Bitcoin price recovery. The double-bottom pattern observed in recent trading activity hints at a potential breakout target of $108,000, provided market sentiment shifts positively.

Savvy investors might capitalize on the current price dip, increasing their Bitcoin holdings around the $90,300, $93,000, and $94,300 support levels. Some Bitcoin maximalists believe that prolonged trade tensions could drive sovereign entities to seek BTC as an inflation hedge. Notably, the Czech Republic and Bhutan have recently explored Bitcoin acquisitions, and U.S. states and corporations may increasingly turn to blockchain solutions to circumvent trade barriers.

Bitcoin Price Forecast: Can BTC Rebound to $108K?

From a technical analysis standpoint, Bitcoin price forecast shows BTC trading near recent significant lows highlighted double-bottom pattern, which often precedes a bullish breakout.

In terms of key levels to watch, BTC must maintains support above $90,500 to keep alive rebound hopes of reclaiming the $96,150 territory. If the trade war sparks a BTC buying frenzy among nations and institutions, the ensuing BTC price recovery could gain enough momentum to test the $102,000-$105,000 range. A sustained rally above these levels could open the door to the $108,000 breakout target.

The Bollinger Bands indicator also highlights key resistance levels that Bitcoin must overcome to reclaim bullish momentum. The upper band suggests significant resistance at $105,800, followed by a more substantial barrier near $108,000. If Bitcoin can consolidate above these levels, it may establish a new bullish trend, counteracting the recent downturn.

In Summary: 

While Bitcoin’s 11% decline in 3 consecutive losing days has rattled investors with $1.8 billion market liquidations. However, key technical indicators point to potential support around $90,500 and possible recovery scenarios. The ongoing trade war and economic uncertainty continue to influence market sentiment, but long-term investors and institutional players could take advantage of lower prices. Should positive sentiment return, Bitcoin could break out toward $108,000, reinforcing its status as a politically-neutral asset.

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Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.